Company Update
Ultrajaya Milk Industry Bloomberg: ULTJ.IJ | Reuters: ULTJ.JK
Samuel Equity Research
17 Februari 2016
Continuing Improvement
BUY (Maintain)
Pelemahan harga susu bubuk yang disebabkan salah satunya oleh penurunan permintaan dari China, kami lihat akan memberikan benefit pada kinerja operasional ULTJ tahun ini. Rendahnya harga susu bubuk dibarengi dengan potensi berlanjutnya penguatan nilai tukar rupiah serta peningkatan daya beli masyarakat menjadi tiga katalis utama yang kami harapkan akan mendorong ULTJ untuk membukukan peningkatan pendapatan setara dengan angka proyeksi kami. Kami juga masih menjadikan rendahnya tingkat konsumsi susu per kapita dan kekuatan ekuitas merek ULTJ sebagai dua kekuatan utama penggerak pertumbuhan marjin kedepannya. Kami mempertahankan sudut pandang positif kami pada kinerja ULTJ FY16 dan memberikan rekomendasi BUY dengan target harga DCF 12M sebesar Rp4,800/lembar saham (16E’PE 20.9x dan 16E PBV 5.0x). Ekspektasi penguatan marjin. Catatan perbaikan kinerja marjin laba kotor ULTJ sejak 1H15 kami perkirakan akan terus berlanjut, utamanya didorong oleh masih rendahnya harga susu bubuk dunia hingga akhir Jan16. Harga susu bubuk telah mengalami penurunan tajam hingga mencapai sebesar -65% dari titik tertingginya sejak Apr13, seiring dengan pelemahan permintaan dari China sebagai pengimpor susu terbesar di dunia. Kondisi tersebut kami perkirakan masih akan berlanjut hingga akhir tahun ini dan akan mendorong potensi kenaikan marjin laba kotor ULTJ sebesar 17% sehingga mengakibatkan meningkatnya marjin laba operasi sebesar 60bps dan marjin laba bersih sebesar 40bps.
Target Price
Rp 4,800
Last price
Rp 3,700
Potential Upside JCI Index
4,745
Share issued (m n)
2,888
Market Cap. (Rpbn)
10,686
52-Weeks High/Low
4,300/3,460
Avg Daily Vol (m n)
Menanti kinerja FY15. Sambil menunggu keluarnya laporan keuangan FY15, kami masih mempertahankan rekomendasi dan target harga terakhir kami (lihat yearbook 12/01/15). Namun, tidak menutup kemungkinan bagi kami untuk menaikkan target harga apabila hasil kinerja FY15 melebihi ekspektasi kami. Maintain BUY. Kami meyakini permintaan susu masih akan bertumbuh kedepannya, didukung oleh: (1). Potensi berlanjutnya kenaikan daya beli konsumen (2). Masih rendahnya tingkat konsumsi susu di Indonesia (13.04 liter per kapita per tahun vs ratarata negara ASEAN sebesar 20 liter per tahun) dan (3) Jumlah kelas menengah masyarakat Indonesia yang terus meningkat. Kami memproyeksikan pendapatan ULTJ akan bertumbuh sebesar 15%YoY dengan kenaikan laba bersih sebesar 18.3%YoY Kekhawatiran kami terletak pada : (1) Pelemahan nilai tukar rupiah (2) Membaiknya permintaan susu bubuk dari China (3) Pertumbuhan volume penjualan dibawah ekspektasi (4) Meningkatnya persaingan minuman susu dalam kemasan (5) Likuiditas saham.
14A 3,917 470 292 101 0.3 698 17.7 36.6 4.7
15E 4,426 810 528 183 0.3 784 21.7 20.2 3.9
45.10%
Nom inal Value
Rp 200
Book value/share ‘16
Rp 960
Relative to JCI Chart 770
ULTJ
JCI
570 470 370 270 170 70 Nov-09
Nov-10
Nov-11
Nov-12
Nov-13
Nov-14
16E 5,090 957 625 216 0.5 960 12.1 17.1 3.2
17E 5,955 1,120 748 259 0.6 1,158 10.0 14.3 2.7
Nov-15
Com pany Background PT Ultrajaya Milk Industry and Trading Company operates in the food and beverage industry. The Company produces aseptic drinks such as liquid milk andtea, fruit juices and health drinks. Ultrajaya also produces butter, pow der milk and sw eet condensed milk. Shareholder Structure PT Praw iraw idjaja Prakarsa
21%
Sabana Praw iraw idjaja
15%
Indolife Pensiontama
8%
PT AJ Central Asia Raya
8%
Public
Forecast and Valuation (at closing price Rp3,700 per share) Y/E Dec (Rpbn) Sales EBITDA Net Profit EPS (Rp/shr) Dividend Yield (%) BV per share (Rp/shr) EV/EBITDA (x) P/E Ratio (x) P/BV Ratio (x)
0.06
Free Float
670
Rencana ekspansi pabrik untuk menjaga ketersediaan suplai susu. Salah satu cara untuk meredam volatilitas harga susu di pasar adalah dengan mengatur ketersediaan suplai sapi. Kami melihat ULTJ cukup responsif di dalam mengatasi resiko keterbatasan suplai, salah satunya melalui pengembangan peternakan di Berastagi, Sumatera Utara. Pasca beroperasinya peternakan tersebut tahun ini, kami memperkirakan setidaknya akan terdapat penambahan sebanyak 23.000 kapasitas head farm dari 12.000 ekor sapi dan mendorong volume produksi susu naik sebesar 5% tahun ini.
29.7%
45%
Marlene Tanumihardja +62 21 2854 8387
[email protected]
Page 1 of 7 DISCLAIMER: Analyst Certification: The views expressed in this research accurately reflect the personal views of the analyst(s) about the subject securities or issuers and no part of the compensation of the analyst(s) was, is, or will be directly or indirectly related to the inclusion of specific recommendations or views in this research. The analyst(s) principally responsible for the preparation of this research has taken reasonable care to achieve and maintain independence and objectivity in making any recommendations. This document is for information only and for the use of the recipient. It is not to be reproduced or copied or made available to others. Under no circumstances is it to be considered as an offer to sell or solicitation to buy any security. Any recommendation contained in this report may not be suitable for all investors. Moreover, although the infor mation contained herein has been obtained from sources believed to be reliable, its accuracy, completeness and reliability cannot be guaranteed. All rights reserved by PT Samuel Sekuritas Indonesia.
Ultrajaya Milk Industry ULTJ.IJ / ULTJ.JK
Figure 1. Consumer Confidence Index
Source: IDCCI, Bloomberg
Figure 2. Indonesia Consuming Class 300
280
265
280
240
People (Mn)
250 45
200
85 135
150
170 100 50
195
180
2010
2020
145
110
0
Below Consuming Class
2030 (GDP: 5-6%) 2030 (GDP 7%)
Consuming Class
Source: Mc Kinsey
Figure 3. Milk Consumption per Capita (Liters per Annum) 60.0 50.9 50.0 40.0
33.7
30.0
22.1
20.0
13.4
10.0 0.0 Indonesia Philippines Thailand
Malaysia
Source: Company data
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Page 2 of 7
Ultrajaya Milk Industry ULTJ.IJ / ULTJ.JK
Figure 4. White Milk Powder and Skimmed Milk Powder Price (US$/MT) WMP
SMP
6,000 5,000 4,000 3,000 2,000
1,000 0
Source: Bloomberg
Figure 5. Avg. milk powder prices for US$/ton and Rupiah/kg Aug’11 – Jan’16 US$/ton (LHS)
Rupiah/kg (RHS)
6,000
70,000
5,000
60,000 50,000
4,000
40,000 3,000
30,000 2,000
20,000
1,000
10,000
0
0
Source: Bloomberg
Figure 6. Revenue growth, est. production growth, net margin 2009 – 2017E Revenue growth
Est. sales volume growth
Net margin
35.0%
30.0% 25.0% 20.0% 15.0% 10.0%
5.0% 0.0% 2009
2010
2011
2012
2013
2014
2015E
2016E
2017E
Source: SSI estimates, Company data
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Page 3 of 7
Ultrajaya Milk Industry ULTJ.IJ / ULTJ.JK
Figure 7. Avg. milk powder cost Rp/kg vs. ULTJ gross margin up to 3Q15 (in Rpbn)
3Q14
2Q15
3Q15
YoY
QoQ
9M14
9M15
YoY
9M15A/ FY15E SSI
Revenue
978
1,151
1,089
11.3%
-5.4%
2,882
3,275
13.6%
74.0%
(739)
(805)
(748)
1.2%
-7.1%
(2,212)
(2,251)
1.8%
240
346
341
42.5%
-1.4%
670
1,024
52.8%
(158)
(251)
(137)
-13.3%
-45.4%
(435)
(541)
24.3%
Operating Profit
81
95
204
151.3%
115.2%
235
483
105.5%
Other Income - Net
28
7
17
38
34
-9.4%
Net interest income (expense)
6
6
13
15
24
Share of net income associated
(10)
(6)
(4)
(15)
(12)
Other income (expense)
37
21
273
517
(67)
(116)
COGS Gross Profit Total Operating Exp.
32
6
7
Pre-tax Income
110
102
221
Tax (expense)
(28)
(23)
(49)
Minority interest
(1)
(3)
(3)
1
(8)
81
76
169
108.3%
121.6%
206
394
90.6%
UHT
984
1,127
1,103
12.2%
-2.1%
2,799
3,245
15.9%
Non-UHT
26
69
28
10.5%
-58.7%
167
158
-5.7%
Elimination
(31)
(45)
(42)
(84)
(128)
51.5%
Total
978
1,151
1,089
11.3%
-5.4%
2,882
3,275
13.6%
Gross margin
24.5%
30.1%
31.3%
23.2%
31.3%
Operating margin
8.3%
8.2%
18.7%
8.2%
14.7%
Net margin
8.3%
6.6%
15.6%
7.2%
12.0%
Net Income
101.7%
117.2%
74.3% 72.2%
89.6%
74.5%
Segment Highlights Revenue
Profitability
Source: Bloomberg
Figure 8. Avg. milk powder cost Rp/kg vs. ULTJ gross margin up to 3Q15 Gross margin (RHS)
Avg. milk powder cost Rp/kg (LHS)
60,000
35.0%
50,000
30.0% 25.0%
40,000 20.0% 30,000
15.0% 20,000 10.0% 10,000
5.0%
0
0.0% 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15
Source: Company data, Bloomberg
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Page 4 of 7
Ultrajaya Milk Industry ULTJ.IJ / ULTJ.JK
Figure 9. Indonesia consumer valuation table as of close 16 February 2016 (excluding UNVR) Com pany
Last price
Unilever Indonesia (UNVR IJ) Kalbe Farma (KLBF IJ) Indofood CBP (ICBP IJ) Indofood SM (INDF IJ) Ultrajaya Milk (ULTJ IJ) Nippon Indosari Co. (ROTI IJ)
Target price
41,500 1,295 15,500 6,600 3,700 1,320
Market cap. (Rp bn)
39,000 1,610 15,600 7,400 4,800 1,500
316,645 60,703 90,380 57,951 10,687 6,682
Weighted average*
PE (x) 15E 16E
PEG (x)
PBV (x) 15E 16E
ROE 15E
EPS CAGR 14A-16E
54.7 28.2 26.4 21.4 20.2 25.4
48.9 23.5 23.0 15.7 17.1 26.4
8.8 2.4 1.2 (8.7) 0.4 1.7
58.5 5.4 5.8 2.1 3.9 5.5
51.5 4.7 5.2 2.0 3.3 4.7
122% 23% 17% 16% 18% 21%
6% 12% 23% -2% 46% 15%
42.4
37.3
(0.4)
5.1
4.5
19%
18%
Jul-14
Jan-15
Jul-15
Source: SSI estimates, Bloomberg (*Excl. UNVR, except for PE ratio & EPS CAGR)
Figure 10. ULTJ’s forward PE Band 50 44.5 40 33.4 30 22.3
20 11.2 10 0 Jan-11
0.1 Jul-11
Jan-12 Average PER - Roll
Jul-12
Jan-13
Jul-13
Jan-14
ST dev +1 ST dev +2
ST dev -1 ST dev -2
Source: SSI estimates, Bloomberg
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Page 5 of 7
Ultrajaya Milk Industry ULTJ.IJ / ULTJ.JK
Key Financials Profit and Loss Statement Rpbn
Cash Flow 14A
Revenue
15E
16E
17E
Rpbn
14A
Net Income
292
528
625
748
Depreciation & amortization
139
141
156
177
3,917
4,426
5,090
5,955
(2,980)
(3,049)
(3,475)
(4,060)
Gross profit
937
1,377
1,615
1,895
Gross margin (%)
23.9
31.1
31.7
31.8
Operating cash flow
Operating profit
327
669
801
942
Net - Capital expenditure
Operating margin (%)
8.4
15.1
15.7
15.8
Other assets
EBITDA
470
810
957
1,120
EBITDA margin (%)
COGS
Working capital
15E
16E
17E
(315)
(54)
(13)
(105)
116
616
768
819
(177)
(150)
(300)
(315)
(58)
(100)
(122)
(168)
(208)
(400)
(437)
Net - Borrow ings
(29)
(14)
(20)
(22)
Other financing
(41)
(19)
(53)
(62)
(70)
(33)
(73)
(84)
Investing cash flow
8
12.0
18.3
18.8
18.8
Other income (expenses)
48
49
46
68
Pre-tax profit
376
717
846
1010
Financing cash flow
Income tax - net
(92)
(179)
(212)
(253)
Net - Cash flow
(122)
375
295
298
Net profit
292
528
625
748
Cash at beginning
611
489
864
1,159
Net profit margin (%)
7.4
11.9
12.3
12.6
Cash at ending
489
864
1,159
1,458
Balance Sheet
Key Ratios
Yr-end Dec (Rpbn)
14A
15E
16E
17E
Yr-end Dec
14A
15E
16E
17E
Cash & ST investment
489
864
1,159
1,458
ROE (%)
12.9
19.0
18.7
18.5
Receivables
407
458
523
610
ROA (%)
10.0
15.3
15.5
15.8
Inventories
714
738
727
794
Revenue grow th (%)
13.2
13.0
15.0
17.0
31
43
37
40
Total current assets
1,642
2,103
2,446
2,902
EPS grow th (%)
Net fixed assets
1,003
1,012
1,156
1,294
Interest coverage (x)
272
329
430
551
2,917
3,445
4,032
4,747
385
402
443
496
ST. debt and curr. maturity
25
18
21
24
Other current liabilities
81
96
91
89
0
0
0
0
Others
Other assets Total assets Payables
LT. debt Other long term liabilities
101
96
91
86
Total liabilities
652
671
686
716
2,265
2,774
3,346
4,031
Total equity
EBITDA grow th (%)
Debt to equity (%) Net gearing (%)
(18.2)
72.3
18.1
17.0
-10.3
81.0
18.3
19.7
n/a
n/a
n/a
n/a
1.1
0.6
0.6
0.6
-17.8%
-28.4%
-32.8%
-35.1%
14A
15E
16E
17E
Major Assumptions Yr-end Dec ASP grow th est (%) Average Rupiah/US$ Milk pow der cost (US$/ton)
10.0
3.0
0.0
1.0
11,885
13,500
13,600
13,200
3,547
2,588
2,328
2,104
Recommendation History – Ultrajaya Milk Industry (ULTJ) Date
Recommendation
6-Aug-15
Buy
3,900
4,800
Buy
4,030
4,800 4,000
12-May-15
Close Price
Target
9-Apr-15
Hold
3,995
7-Nov-14
Buy
3,800
4,525
4-Jul-14 17-Apr-14 21-Jan-14 11-Jun-13
Buy Buy Buy Buy
4,005
4,470 5,300 5,300 4,525
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4,040 4,475 3,875
Page 6 of 7
